Welcome back everyone and thank you for joining us for this week’s case of the week. Before we begin, we would like to say thank you to everyone who has booked on to this year’s seminar. For those yet to book their place it will be on Tuesday 12 March and we’ll be discussing all employment changes taking effect in April including holiday pay, sexual harassment and flexible working. There will also be a hamper for the attendee who refers the most attendees. To book your place or find out more, please visit our booking page.

This week, we look at the case of Z v Commerzbank AG et al and ask, what conduct is so unreasonable that a Tribunal would order you to pay the other side’s costs?

The Claimant, referred to as ‘Z’ due to an anonymity order, worked as a ‘know your client’ analyst at the Respondent company. The Claimant had difficulties during his probationary period, but eventually passed. However, there were issues between him and his colleagues. He alleged multiple acts of discrimination against them and sexual harassment which was particularised as an “assault” by one of the Respondents who was also anonymised as ‘Q’. This complaint for harassment was that Q had remarked how his vest could be seen through his work shirt, as it was of a thin material. He was dismissed on 21 November 2019, after which he was ‘encouraged’ by security personnel to leave the premises. While a complaint was made to the police, no further action was taken.

Describing the case management process, the Tribunal stated it was ‘lengthy, painful and disproportionately costly’. Documents were not disclosed or partially disclosed by the Claimant. Covert recordings of meetings said to contain important evidence was not produced until the fourth day of the hearing and only included portions helpful to the Claimant’s case. It was also made clear that the amount of evidence produced ‘could not possibly assist the Tribunal to decide the claims’. The Claimant raised multiple complaints, including – the misspelling of a witness’ name, a typographical error, and the date when the claim was presented. The Judge considered that these issues made no material impact on the underlying decision. Complaints were raised about the apparent bias of the Judge, who had heard claims against the Respondent on two other occasions, one wherein the Claimant was successful and another where they were not. The Tribunal, in first instance found that some of the claims brought had little reasonable prospect of success and a deposit order was made. No deposit was paid and the claims were struck out. Almost all the remaining claims were dismissed as being ‘pure invention’.

It was found that ‘the Claimant has shown himself to be a witness contemptuous of his duty to tell the truth and unworthy of belief’. The Judgment does not pull any punches about the Claimant or his conduct. The Respondent subsequently made an application to the High Court for contempt of court, as well as an application for wasted costs. The Claimant sought to appeal the decision to the Employment Appeal Tribunal on the grounds of the anonymity order and costs award.

As an alleged victim of a sexual crime, the Claimant was entitled to have his identity protected in the proceedings. Finding that his claims were a malicious fabrication, the Tribunal sought to lift the anonymity order. While it was argued that the anonymity order should be lifelong, the EAT found that the Claimant should not be allowed to litigate without the publication of his name under these circumstances. Another ground of appeal was in relation to the costs award. The Respondent’s applied for an award of £20,000, being the maximum available without a detailed assessment despite their actual costs far exceeding this amount. The Claimant argued that his means could not cover this figure and should be reduced accordingly.

The appeal was dismissed. The EAT agreed with the decision of the ET in finding that less than spurious litigation, which may even be found to be criminally contemptuous, should be met with appropriate awards for costs as a deterrent.

Takeaway Points

The first point is to not lie under oath!  Telling lies tends to not do very much for one’s credibility or prospects of success.

The more intricate point here, however, is the issues around disclosure and costs awards. All relevant documents, even those harmful to the party who has them, must be disclosed. A failure to disclose relevant evidence will lead to the risk of a costs award

Costs are an important factor in all litigation. While Employment Tribunals will only award costs in exceptional circumstances, it is the proportionality of those costs that is important. Wasting time, failing to meet deadlines set out in orders, and bringing spurious claims will all leave the party open for costs awards. The means of a party are taken into account when making an award and £20,000 was deemed to be within the Claimant’s means.